As we have remarked here before, the gold majors cannot replace their gold inventories by exploration, so they have to buy deposits, usually via takeovers. One of the next Australian companies to get the tap on the shoulder will surely be Perseus Mining (PRU), with its impressive gold inventories in Ghana and the Ivory Coast.

Similarly, in Canada, we have seen Kinross Gold move on Red Back Mining to get control of gold mines in Mauritania and Ghana.

And, in what would have seemed extraordinary only a year or two ago, we now have North American major Newmont Mining become a cornerstone investor in a -- wait for it -- float worth just $12.5 million.

Middle Island Resources -- so new that it has not been listed as an upcoming IPO on the ASX -- will have Newmont holding 11 per cent as its sets out to find gold in Burkina Faso and Niger.

Companies like Newmont simply don't get involved with $12.5m floats -- until now, that is. Its participation may be a sign of the desperation of majors to get their hands on gold.

Once, they would have waited for a million or two ounces to be proved up before pouncing, but now they need to pre-empt any competitor beating them to anything.

We could speculate for days about which other of the Australian gold companies active in West Africa will be on someone's takeover watch list. But you can be sure that several will.

This trend will only accelerate as the gold price rises. The ANZ commodities team, led by Mark Pervan, has put out a gold report entitled "More Upside to Come". They look at the usual arguments -- the safe-haven appeal, wealthier Chinese, Indian and Middle Eastern types buying investment gold, along with tight supply.

But, while acknowledging that producer de-hedging should be complete by mid-2011, thus easing investment demand, the ANZ team comes up with a new and interesting angle.

They believe the upside surprise may come from central bank buying. The bulk of the emerging economies are overweight US dollars and underweight gold.

Look at China: it could decide to buy the entire 2011 world mine gold output (about 2400 tonnes) and still end up with gold as only 5 per cent of its total foreign reserves. The US, Germany, Italy and France still have more than 50 per cent of their foreign reserves in gold.

The global average is 15 per cent, but look at the other countries well below that level of gold reserves. That list includes Japan, Russia, India, Taiwan, Singapore and Saudi Arabia.

Breathe easy

ABOUT a month ago, Pure Speculation expressed a little concern about a decision by Northern Uranium (NTU) to sell 51 per cent of itself to a Chinese company that is involved in what was described as "major state classified projects".

It was all about NTU's heavy (the most valuable ones) rare earths project in the Northern Territory. As you know, rare earths are a big geopolitical issue at the moment; they are vital to so many technologies and China controls 95 per cent of the world's supplies.

Anyway, it looks as if we can breathe a sigh of relief. Since then we've had rare earths leader Lynas Corp (LYC) snap up 9.44 per cent of NTU in a move which was seen as the first step to blocking the Chinese, and now Northern Uranium has decided to put the Chinese proposal on hold and, instead, deal its own shareholders back into the mix with a $6.6 million rights issue.

At some stage, Australia is going to need a national discussion on ownership and control of these and other strategic minerals -- a far more useful dialogue than the mining tax nonsense.

Near miss?

BIGGEST disappointment of the week in the mining world -- apart, that is, from having the Greens calling the shots in Canberra -- was from Chrysalis Resources (CYS), part of the Doolgunna nearology story.

This is the area where Sandfire Resources (SFR) made its high-grade DeGrussa copper-gold discovery north of Meekatharra last year, and which led to a land rush to peg surrounding ground. Investors piled into any stock that put out a release that indicated it had ground adjoining or a few kilometres from the SFR hotspot.

Unfortunately, Chrysalis reported that its initial drilling efforts at five target areas "have returned no results of significance". It added: "At this stage the company has no explanation why the assays have not returned any anomalism."

On the day of the announcement, CYS shares fell 33.3 per cent, which is not surprising. However, Pure Speculation -- which is an innocent in these matters -- wonders what provoked a 19.2 per cent fall in the company's price on August 25, followed by CYS seeking a trading halt until the drill results announcement.

Has the ASX noticed? Might it be worth their noticing?

Anyway, the CYS news might put a bit of a brake on the Doolgunna nearology headiness.

By coincidence, Sandfire announced the following day that it had increased its resource at DeGrussa to a contained 600,000 tonnes of copper, 660,000 ounces of gold and 5.1 million ounces of silver. SFR's shares rose 10.5 per cent on the news to $5.80.

Geothermal is go

THE Asian Development Bank has launched clean-energy bonds, which will be issued in Australian dollars, Turkish lira and Brazilian reals. The aim is to pump $US2 billion ($2.2bn) a year into projects that use wind, solar, biomass, hydro -- and geothermal -- to supply Asian consumers.

The geothermal is significant because this is a sector in Asia attracting some Australian interest, especially in Indonesia.

On Thursday, we saw Origin Energy (ORG) team up with India's Tata Power to bid for a geothermal concession in northern Sumatra. That is significant enough, but Tata is also developing a small geothermal power station in Gujarat and wants to pursue other projects in India. London-based market researcher Datamonitor recently identified geothermal as a large opportunity for India.

Meanwhile, back in Indonesia, Panax Geothermal (PAX) is about to formalise a joint venture agreement to build a 30 megawatt power station on Flores Island. And there's Greenearth Energy (GER), which has a 40 per cent stake in an Indonesian geothermal explorer.

More to Ghana

WHILE much of our African focus is on gold in Ghana and its neighbours, there are plenty of other interesting stories on that continent. Gulf Resources (GLF) has been busy recommissioning a vermiculite plant in Uganda and now has decided to go ahead with the Soalara limestone project in Madagascar.

The company says it has already been approached by several large companies in the cement and steel sectors about joint-venture possibilities.

Industrial minerals may not be at the glamour end of the minerals business, but there is clearly some promise there.

That would account for the recent move by one of the African Lion funds -- which includes as shareholders the European Investment Bank and a subsidiary of South Africa's FirstRand banking group -- to take a 19.85 per cent stake in GLF.